Video: New Orleans levee board negligent?

The unveiling of the Mardi Gras Fountain was celebrated this year in typical New Orleans style. The cost of $2.4 million was paid by the Orleans Levee Board, the state agency whose main job is to protect the levees surrounding New Orleans — the same levees that failed after Katrina hit.

"They misspent the money," says Billy Nungesser, a former top Republican official who was briefly president of the Levee Board. "Any dollar they wasted was a dollar that could have went in the levees."

In fact, NBC News has uncovered a pattern of what critics call questionable spending practices by the Levee Board — a board which, at one point, was accused by a state inspector general of "a long-standing and continuing disregard of the public interest."

Beyond the fountain, there's the $15 million spent on two overpasses that helped gamblers get to Bally's riverboat casino. Critics tried and failed to put some of that money into flood protection.

There was also $45,000 for private investigators todig up dirt on radio host and board critic Robert Namer.

"I assure you," says Levee Board President Jim Huey, "that you will find that all of our money was appropriately expended."

Huey says money for the levees comes from a different account than money for business activities and that part of the board’s job is providing recreational opportunities.

And despite the catastrophic flooding, Huey says, "As far as the overall flood protection system, it's intact, it's there today, it worked. In 239 miles of levees, 152 floodgates, and canals throughout this entire city, there was only two areas."

But those two critical areas were major canals and their collapse contributed to hundreds of deaths and widespread destruction.